Michael McKean is an experienced writer with a portfolio that includes work on the subjects of sport, gambling, travel and finance. With a background rooted in journalism, Michael first ventured into the professional writing world based in Switzerland, where he wrote for a number of language and travel sites and magazines before moving into the world of sports writing and gambling sites.
As an avid soccer fan, who follows everything from the Scottish lower leagues to the European elites, he has earned himself a solid reputation as a reliable football betting tipster and predictor. Outside of work, Michael has always gotten involved with grassroutes football everywhere he has worked and lived - UK, Spain, Portugal, Switzerland and Brazil - and still isn’t shy when it comes to pulling the boots on himself. As well as soccer, he has also developed a love of North American sports, particularly ice hockey - a love which began in Switzerland and saw him venture across the pond to follow the NHL. Moving away from dry land, he’s also a keen longboard surfer and is happiest when writing with a view of the ocean.
Variable betting is a powerful tool used to win more and lose less with sports betting, or at least that’s the goal with methods like the Kelly strategy. Players adjust their wagers up and down based on their information to win more reliably. The Kelly Criterion relies on using bankroll information, odds information and probability to determine how much money to wager with each bet. The betting strategy is a bit confusing and relies on a formula, and it’s aggressive with many of the wager amount recommendations that it makes, but that’s why the strategy works so well. Gamblers that want to win as much as possible can benefit from the strategy. Below we cover how the strategy works, we break down the formula and explain some alternatives to the Kelly Strategy as well.
Kelly Strategy Key Facts
Makes use of advanced information for accurate wagering
Changes based on probability, odds and bankroll
What is Variable Staking?
Variable staking is a betting strategy that relies on betting different amounts each time to adjust with a changing bankroll, odds and wagering success. There are dozens of different variable staking techniques, some of which work better than others. Serious sports bettors should try out different wagering strategies to see which ones work best for them and which ones simply don’t feel right. Often several strategies are used with different betting lines, but not always. We have these betting lines explained here.
Variable staking is a wagering technique that tries to increase the profit potential of wins, while reducing losses overall. Some strategies rely on changing the overall wager amount based on bankroll size, and others change things up depending on odds, past success and other variables. The Kelly Strategy is an advanced variable staking strategy that takes all of those different things into account.
Understanding the Kelly Strategy
For gamblers that don’t mind relying on more advanced strategies, the Kelly formula can be a powerful tool for winning more effectively while wagering online. This variable staking strategy has gamblers change the amount they wager based on the odds of the specific wager as well as their total bankroll size. By accounting for these two important variables the strategy can more effectively adjust to help enhance wins and minimize losses.
How Does it Work?
The Kelly Criterion relies on an advanced formula to explain how much to wager in each specific situation. In order for the formula to work the player must determine the chances of winning or losing a specific wager as accurately as possible. The more accurate the prediction is, the more effective the Kelly strategy is to use. Gamblers that want to make use of this unique betting strategy just have to get information about the wager, like the odds and the probability of winning the wager, and combine them with information about their current bankroll amount to get a suggested wager amount. The better the chances are of winning the wager, the more money players are recommended with this betting strategy. That’s what makes it so effective and what helps gamblers to be profitable over time.
What is the Benefit of the Kelly Strategy?
When used effectively the Kelly strategy can make gamblers more profitable. That’s because the strategy minimizes losses and maximizes wins as regularly as possible. By accounting for the odds of winning or losing, the criterion raises bets and lowers them to make sure as much money is coming in as possible while letting go of as little as possible. This strategy can be used for all sorts of different sports bets, and it isn’t difficult to use either after getting familiar with it, but getting those odds right is the most important step to making it work. Get accurate odds and you’ll win more consistently. Mess up the odds frequently and you’ll lose considerably more than necessary while using the strategy.
Exploring the Formula
The Kelly Criterion relies on a specific formula to determine how much money should be wagered each time. Deciding what to bet is as simple as plugging in the different numbers and placing the wager suggested at the end.
The formula is as follows: (bp – q) / b = f
What the Formula Means
b = the decimal odds of the bet minus 1
p = the probability of a wager being successful in decimal form. A 60% probability is 0.60
q = the probability of a wager losing, it’s simply 1 – p or .40 in this instance.
f = the fraction of your total bankroll you should wager.
To make use of the formula players need only plug in all the different bits of information about a specific wager. Plug that information in and they will know exactly how much of their bankroll they should be wagering for the specific bet opportunity. The amount to wager changes dramatically depending on the conditions of the bet, and that’s the whole point of the Kelly Strategy. The strategy makes it easier to fully leverage the power of a good winning opportunity while working hard to help avoiding betting too much on a bet that offers too little of a reward for the risk.
Testing it Out
Now that we’ve explained the formula a bit, it’s time to test it out in a simple example to really showcase how it works.
Imagine that we’re placing a wager with a 60% chance of winning and 2.00 odds.
Our bankroll is $2,500 giving us a decent amount that we can wager comfortably.
To find out exactly how much to wager we only need to plug the numbers into the formula.
(bp – q) / b = f
b is 1 in this instance because that’s 2.00 – 1
p is .60 and q is .40 giving you all the information you need to plug everything in.
You get ((1*.6) - .4) / 1 = f
Or .2 = f when you do out the math.
That means with those odds and that probability you should wager approximately 20% of your total bankroll. In this case that would be $500. Even slight fluctuations in odds or the probability of winning can adjust the total amount that should be wagered in a big way. After looking at the formula in action it’s easy to see how some gamblers might say that the strategy is aggressive. Most betting experts would never recommend wagering $500 at a time with a $2,500 bankroll, but that doesn’t mean that the system won’t work for you.
Is the Kelly Strategy Right for Everyone?
It’s important for gamblers to take the time to decide if the Kelly strategy is right for them before implementing it all the time. It’s a much more aggressive strategy than something like fixed wagering is, but it’s a strategy that can pay off in a big way for gamblers that are good at predicting their probability of winning any one bet. If they predict the probability properly they will likely win big using the Kelly Criterion, some gamblers will have a hard time making the wagers needed to make the most of the strategy though. There are instances where a wager of 50% or more must be laid down to get the most from the betting strategy. When that’s the case only gamblers comfortable with making those sorts of wagers will benefit from the system. Everyone else should go with a more reserved betting strategy that they can be more comfortable with.
The Kelly Strategy is also more difficult to make use of than something like the Martingale betting strategy or fixed wagering. You can read an overview about the Martingale betting strategy here.
Test out the Strategy Today
Sports bettors should take some time to test out the Kelly Criterion to see if the strategy will work for them. This powerful betting strategy is a tool that can result in some impressive wins, but it’s something that only works well for some gamblers. Take the time to look through different sportsbooks, decide on one to join and start testing out this strategy to see how well it will work for you. Sign up today and start working toward bigger and better profits.
Conclusion: The Kelly Strategy is Complicated but Effective
The Kelly Strategy is an advanced variable staking strategy used by sports bettors to help them place more effective wager amounts. This strategy is confusing to understand, but many gamblers report success using it. It’s worth trying out, and it’s a tool that gamblers can use easily if they get a calculator to determine the recommended wager amount each time.